US home prices posted the biggest quarterly percentage gain in two years, up 3.6 percent from 2011, according to market research firm S&P/Case-Shiller says.
The 3.6 percent increase from last year is more than three times the rise in the previous quarter and was the biggest jump in prices since the second quarter of 2010. This increase in housing prices is more substantial because the 2010 rise was due, in large part to, a homebuyer’s tax credit of up to $8,000 on homes purchased in late 2009 and early 2010.
Home prices rose overall in September for the sixth month, signaling that the housing market is “in the midst of a recovery,” according to the S&P/Case-Shiller home-price index released Tuesday. Tuesday’s report on home prices is the latest news on a strengthening housing market. There have also been recent gains in new construction, home-builder sentiment, and existing-home sales.
The S&P/Case-Shiller 20-city composite posted a 0.3 percent increase in September, which followed a 0.8 percent gain in August.
“We are entering the seasonally weak part of the year. Despite the seasons, housing continues to improve,” said David Blitzer, chairman of the index committee at S&P Dow Jones Indices.
Among the 20 cities tracked by the index, 13 posted monthly gains in September. However, while persistently low mortgage rates are attracting some buyers, consumers still face tight credit standards, and officials say factors such as tight lending terms will block a powerful housing recovery.
Despite recent gains, prices remain about 30 percent below peak levels reached at the height of the housing bubble in 2006, according to Case-Shiller data. Housing prices are unlikely to reach those levels again, because many experts believe those prices were artificially manipulated.